RE:RE:Brian Bergot on zoom Dec 3rd.You can understand why he is saying that Gib is the only asset taken into account in the SP. Gib NPV of ~$750 million, subtract $310 mill in debt, leaves $440 value, yet EOD market cap today is only $375 million. Adding in the cash, the SP reflects a market cap of $165 million less than Gib + cash - debt. So zero value is factored in for any of the other assets.
I am now thinking that the PP was partially due to the restrictions on the Sr notes that limit how much more they can borrow. He mentioned that they are only allowed to take on $50 million more for debt for equiment plus $100 million more debt. So if they cannot raise enough from the JV, they are going to need there current cash and the all of the $100 million debt they are allowed to bring on to cover initial CAPEX for Flo. It sounds like they are hoping for the SP to start to reflect the underlying value of Flo after the permits come in, and they might look at another PP once share prices climb.He did say at $3.50/lb Cu the NPV for Flo is $900 mill USD.
Obviously they are trying to get the permits and financing nailed down ASAP so they can get the $250 million USD notes refied at better rates. Its too bad they didn't buy back any of the bonds in the market when they were trading at such a deep discount.
Spitballing, if the permits come in and the have an option to sell all of Flo for say $600m USD. That's $820m CAD in the bank, on top of what we currently have and continue to rake in from Gib as Cu rises to $4/lb. That would be a big leap towards funding most of Yellowhead.
However, I still think keeping as much of Flo as possible is the best long term play. With such a low cost to produce pure cathode, it would enable Taseko to keep the lights on if Cu drops so low tht Gib has to be put into care and maintenance.